Similarities: Both articles provide for the seller’s right to cure after the date of performance. They both protect the interests of the aggrieved party. The costs of cure are to be borne by the non-performing party. If the non-performing party gives notice of cure, the aggrieved party may not resort to any remedy which is inconsistent with performance. The right to cure does not preclude the other party’s right to damages.

Differences: Article 7.1.4 PICC 2016 is much more detailed than Article 48 CISG. Under Article 7.1.4 PICC 2016, the non-performing party must give notice of its intention to cure, whereas such a notice under Article 48(2) CISG is only relevant with regard to the buyer’s ability to resort to a remedy which is inconsistent with performance. According to Article 7.1.4(2) PICC 2016, the right to cure is not precluded by a notice of termination by the aggrieved party; according to Article 48(1), sentence 1 CISG the right to cure is subject to Article 49 CISG, thus it cannot be exercised if buyer has already avoided the contract. Article 7.1.4(4) PICC 2016 explicitly mentions the aggrieved party’s right to withhold performance pending cure. Although the CISG does not contain a similar provision, the right to withhold performance can be regarded as a general principle of the CISG.

In the court’s view, as long as a defect can be cured, there is normally no fundamental breach that could give rise to a right of avoidance under Article 49(1)(a) CISG. Thus, most of the time, Article 48(1) CISG prevails over Article 49(1)(a) CISG.

The two extracts approach the relationship of Article 48 and 49 CISG from different perspectives without differing in substance. The court argues from the perspective of Article 49 CISG that there is no fundamental breach if the seller could remedy its failure to perform under Article 48 CISG, unless exceptional circumstances warrant immediate avoidance. The CISG Advisory Council in turn clarifies that the seller cannot rely on its right to cure if there is a fundamental breach, i.e. the goods are unusable, and the non-conformity is not curable in time.

To protect the interests of the buyer.

This depends upon the circumstances of the individual case. Criteria to be taken into account are the market situation, price fluctuations, previous attempts to cure, buyer’s loss of trust in the seller, disruption of buyer’s production, threatened actions for damages by buyer’s customers, and buyer’s need to have conforming goods at its disposal.

(a) According to the standard terms, the buyer had to declare its intention to avoid the contract, which still gave the seller the opportunity to cure within 15 working days after the receipt of the buyer’s warning.

(b) If there were no standard terms, under Article 48 CISG, the seller’s failure to perform within the period within which it had promised to cure certainly amounted to a fundamental breach of contract that gave the buyer the right to avoid the contract after 10 September 1993.